OXFORD has the highest hotel occupancy rate in the country but the cost of a night's stay in the city could come tumbling down in the next two years.

Research by real estate advisor Colliers International has revealed only Edinburgh is as stretched as Oxford when it comes to available hotel rooms in the UK.

But several new hotels, including a Marriott hotel in Paradise Street and Premier Inn opposite the Westgate Centre, due to open in the coming years could ease the strain and bring prices down.

The firm's UK Hotel Market Index revealed the city's hotels were 83 per cent full in 2017 and the average daily rate was £102 - up from £99 the previous year.

Peter Brunt, of the firm's hotels agency team, said the proposed developments would affect both occupancy rates and the cost of a hotel stay in the city.

He said: "Hotel accommodation in Oxford is in high demand, and this is reflected in current high levels for room occupancy and the average daily rates for rooms.

"However it has slipped down this year's UK Hotel Market Index as a result of having a higher active hotel pipeline - that is the total number of rooms expected to enter the Oxford hotels market in the next two years as a percentage of total existing room supply as at the end of 2017.

"Last year the active hotel pipeline in Oxford was 0 per cent, whereas this year it is almost nine per cent of the total room supply - and this will inevitably impact upon occupancy rates and average room rates."

The study saw Oxford drop down the list of 'hotspots for hotel investment and development'.

It said the city had become a less desirable location for investors to acquire and existing hotel or develop a new one because of the number of new hotels planned in the area.

Construction work has begun on a 140-bedroom Marriott hotel on the site of the former Cooper Callas building and it is expected to open next year.

A 90-bedroom Premier Inn was given planning permission in December and will be built in Greyfriars Court, immediately outside the western entrance of the Westgate Centre - once the 1980s Critchleys office block is demolished.

The £75m masterplan for Oxford Station also contains a hotel and plans for a 180-bedroom budget easyHotel in Summertown have been submitted to Oxford City Council, amid much local opposition.

Oxford City Council's head of corporate strategy and economic development said the city was responding well to its 'booming visitor economy.

He said: "The City Council has responded to the high demand for hotel accommodation in central Oxford by encouraging the development of new mid-market hotels in the city centre regeneration area.

"Over the next 18 months, the new hotels that have been approved for Paradise St and Norfolk St will be under construction, and will add around 300 beds to the existing stock.

"In the longer term, we expect to see a large new hotel as part of the rail station redevelopment."

He added: "Supporting and managing our booming visitor economy is a priority for our city centre strategy and the new Local Plan."

The council's local plan, which sets out potential development and planning policies through to 2036, encourages purpose-built short-stay accommodation in the city centre, district centres and on main routes into Oxford.

The plan will be finalised in the summer but the draft version opted to encourage hotels to increase the number of tourists staying overnight in the city and stop day-time visitors who don't spend money.

But not everyone is happy with the influx of hotels in the city.

When the Premier Inn proposals were approved Oxford Preservation Trust warned the council not to let its desire for new hotels allow developers to 'dominate and spoil' areas of the city.

It said it was crucial the hotels built were 'right for the wider communities'.